Abandonment of the American Student

Over the past ten years, cost of attendance at public four year universities has increased between 26% in the middle states, to 86% in the West. Strapped for cash, state governments force their public universities to compensate for limited resources by charging more from students. Meanwhile, Education only accounts for roughly 2% of federal spending.

Spending cuts to public universities shifts the burden of providing higher education to family bank accounts, despite stagnation in median family income. How can we justify extreme tuition hikes, as well as $11 billion of annual spending on new campus facilities nationwide, when there has been little to no improvement in average family income?

Even as the proportional value of Pell grants on tuition has dropped significantly since their introduction, some lawmakers suggest freezing their limit for the next ten years.

For millennials looking forward, a new federal regulation prevents mortgage lenders from approving loans to applicants with monthly debt that exceeds 43% of monthly income. This safeguard against predatory lending will make it difficult for young people who owe a piece of the nation’s $1 trillion student debt to borrow money for their first home.

Ironically, it seems that the predatory lending has migrated from the housing market, into higher education. But don’t cast all the blame on public institutions:

In 2009, students attending for-profit universities accounted for 26% of federal borrowers

Forty-three percent of all defaults on federal loans in 2009 were from students of for-profit colleges

One of these businesses, the Apollo Group, owed 85% of their 2010 revenue to federal aid.

Be aware of candidates’ stances on the student debt crisis as November elections approach, and explore some positions from the 2014 budget debate here.